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In order for assisted living expenses to be tax deductible, the resident must: Be considered chronically ill. This means a doctor or nurse has certified that the resident either: cannot perform at least two activities of daily living (ADLs), such as eating, toileting, transferring, bath, dressing, or continence; or.
Can I deduct these expenses on my tax return? Answer. Yes, in certain instances nursing home expenses are deductible medical expenses. If you, your spouse, or your dependent is in a nursing home primarily for medical care, then the entire nursing home cost (including meals and lodging) is deductible as a medical expense.
Assisted living expenses could qualify as medical expense tax deductions if they make up more than a percentage of your adjusted gross income.
One way for you or your parent to save money is by deducting eligible assisted living expenses on taxes. Use this guide to learn about what you can deduct and how to calculate these figures.
You won’t be able to deduct assisted living expenses if you claim the standard deduction on your tax return. Itemizing deductions involves adding up qualified medical expenses and then deducting the amount that exceeds 7.5% of your adjusted gross income (AGI).
In an assisted living community, fees may be tax deductible if an assisted living resident is chronically ill and medical care is prescribed by a licensed health care provider or...
If the caregiver is financially supporting the individual in assisted living and can claim them as a dependent on their tax return, then the expenses related to medical care, including portions of assisted living costs that are attributable to medical or nursing care, may be deductible.
When a physician has determined that an individual can’t perform activities of daily living (ADLs) on their own, assisted living costs are tax deductible. These include needing help with ADLs, such as eating, bathing, dressing, and using the toilet.
Expenses for in-home, assisted living, and nursing-home services are also tax deductible. (See IRS Publication 502 for a full list of qualifying services.)
To deduct medical expenses related to assisted living, they must exceed 7.5% of the taxpayer’s adjusted gross income (AGI). Only the amount that exceeds this threshold is deductible. This means that if your AGI is $40,000, any medical expenses above $3,000 (the amount that is 7.5% of $40,000) could be deductible.